Sugar…do-do-do-do-do-do

“Sugar, rum, and tobacco are commodities which are nowhere necessaries of life, [but] which are…objects of almost universal consumption, and which are therefore extremely proper subjects of taxation.” Adam Smith, The Wealth of Nations

The rationale for taxation of sugar-sweetened beverages has been discussed extensively in the literature as a method to reduce the increasing rates of obesity associated with the consumption of these calorie-rich beverages. The current study was undertaken to evaluate how the price of sugar-sweetened beverages affects their consumption in a wide range of households in Brazil given that a paucity of research exists, particularly in non-developed countries, that actually evaluates the behavioral outcomes of such taxation.

The study design used was one of a retrospective logistic regression to assess the primary outcome variable of price elasticity coefficients (simply put, the percentage variation in the consumption of sugar-sweetened beverages given a 1 percent variation in the price). Researchers hypothesized that sugar-sweetened beverage consumption would decrease with increasing price (i.e. taxation) in all households. The primary data set used for the regression analysis was from the 2002-2003 Household Budget Survey carried out by the Brazilian Institute of Geography and Statistics. The data contained 1 week of records of detailed food purchases per household collected among 48,470 households. The households were selected by a cluster sampling procedure so as to reflect known proportions of geographic and socioeconomic variability within the overall population of Brazil. Food eaten in restaurants outside the home was not accounted for and data validity measures for the records of food purchase were not included (although there were interviewers from the study who instructed and collected the records found in booklets from each household).

The results suggested that the increase in the price of sugar-sweetened beverages led to reductions in consumption. When all households were compared, those with higher incomes purchased more sugar-sweetened beverages on a per calorie basis (14 Calories per adult per day vs. 49 Calories per adult per day). Consumption of sugar-sweetened beverages, once adjusted for income, demonstrated that as price increased (relative to other foods and beverages) consumption decreased. Ultimately, the price elasticity for sugar-sweetened beverages averaged -0.85. Put another way, for every increase of 1.00 percent increase in price, Brazilian households would be 0.85 percent less likely to purchase sugar-sweetened beverages. However, household income influenced price elasticity. The price elasticity of poor households was almost twice the size of that for non-poor households (-1.03 versus -0.63) suggesting that taxation of sugar-sweetened beverages would disproportionately impact the poor in Brazil.

Commentary

The disproportionate effects of taxation on consumption of sugar-sweetened beverages amongst the poor in this study is an important factor to note. This suggests that at a certain point, healthier and/or cheaper alternatives such as water become more palatable due to economic pressures. However, the poor in Brazil are not the largest consumers of sugar-sweetened beverages overall; in fact, the rich consume more. Therefore, decreased consumption of sugar-sweetened beverages amongst the poor might not reverse obesity trends in the population as a whole.

Additionally, the data set is limited to consumption of sugar-sweetened beverages at home. Relationships between consumption behavior outside the home may vary widely amongst households and thus have a huge effect on obesity trends. This was not addressed at all. For instance, in the United States many families eat 1/3rd of their meals outside the home. Extrapolation of these results to predict effects of soda taxation on American consumption behaviors would prove difficult if not impossible.

Share what you learned:

Like this:

LikeLoading…

About Jennifer Shine Dyer, MD, MPH, FAAP

Jennifer Shine Dyer, MD, MPH, FAAPis a pediatric endocrinologist in private practice in Columbus Ohio, an accomplished behavioral researcher currently at Stanford University, a mobile health entrepreneur, and a social media enthusiast (@EndoGoddess). She is a thought leader in driving data-based health outcomes and behavior change with mobile health, gaming, and social media which she has discussed at Diabetes Technology Society, ADA, The White House, Doctors 2.0 & You in Paris, TEDx, SXSW, Stanford, Mayo Clinic, mHealth Summit, and Harvard.
Dr. Dyer works in private practice at Central Ohio Pediatric Endocrinology and Diabetes Services (COPEDS) in Columbus, Ohio to help young people with diabetes to live positive, full, modern, empowered, and long lives.
Dr. Dyer received her MD from The University of Texas Health Science Center San Antonio, trained in pediatrics and endocrinology at The University of Texas Southwestern Medical Center Dallas, and earned her Master in Public Health from the Ohio State University College of Public Health. She began contributing to Policy Prescriptions® in 2011. Contact: Website | Facebook | Twitter | More Posts

In 2004, the Centers for Medicaid and Medicare (CMS) launched the CMS Hospital Inpatient Quality Reporting program, which would publicly report quality of care delivered by US hospitals. A recent study investigated quality of care measures and racial/ethnic performance rates among and within [...]

Source: Kevin Dooley (Flickr/CC) Traveling by air during the 1950s and 1960s during the Golden Age of Flying was different from what most of us are used to today. Lavish layouts, complimentary drinks, and exorbitant ticket prices made air travel for the majority of people out of reach. Nowadays, [...]

The Affordable Care Act (ACA) increased emphasis on quality reporting for doctors and hospitals in an effort to improve care and, hopefully, improve health outcomes for patients. Whether or not this will be accomplished is yet to be seen. However, Medicare’s Hospital Compare tool, implemented [...]

As a medical student living in Texas, two things are very familiar to me: having uninsured family members and being solicited by said family members for medical advice. Source: Kirt Edblom (Flickr/CC) A few weeks ago, a relative approached me at a family BBQ (also familiar to anyone living in [...]

Medical liability accounts for only 2.4% of all health care costs, yet medical malpractice reform is often hailed as a critical ingredient to reducing costs. Though capping non-economic damages—those that compensate patients for their pain, suffering, emotional distress, and disfigurement [...]

The cost-reductions built into the Patient Protection and Affordable Care Act (ACA) are based upon the assumption that as the number of uninsured decreases, the need for federal subsidies to hospitals providing uncompensated care will also decrease. However, 25 states have declined Medicaid [...]

When President Barack Obama first ran for president in 2008, universal health care seemed like a real possibility. Fast forward seven years later: Employer-sponsored health care is still the main game in town. Has the Affordable Care Act impacted employer-sponsored health care in the last few [...]

Under the Affordable Care Act, eligibility for Medicaid benefits was expanded to include low-income childless adults. This provision has proven to be immensely controversial, however, and 23 states have refused to accept it*. A survey published in Health Affairs asked low-income adult citizens [...]